The main reason for opening a holding company in Ireland is the taxation system. The low corporate tax and the extended network of double tax treaties Ireland has with many countries provide an excellent environment for holding companies. Also, as an EU and OECD (Organization for Economic Co-operation and Development) member state, Ireland provides a well-regulated jurisdiction for holding companies. Due to the participation exemption Irish holding companies may dispose of its shares in any other company within the European Union or a country Ireland has a treaty with, thus obtaining a from a capital gains tax exemption. This exemption applies if at least 5% of the ordinary shares have been held for minimum a year and if the trading condition is respected.
For complete information about the participation exemption for holding companies you can ask our specialists in company incorporation in Ireland.
Furthermore, our local consultants invite you to watch this useful video about the holding companies in this country:
There are two ways to incorporate a holding company in Ireland:
The main advantage when registering an Irish holding company as private limited company is that there are no minimum share capital requirements. For public limited companies, the minimum share capital required in Ireland is approximately 38,000 euros and 25% of it must be paid upon incorporation. For company registration in Ireland you can rely on our experts.
As mentioned above the Irish corporate tax is among the lowest in Europe and in the world. Irish holding companies are subject to a 12.5% corporate tax rate on the profits resulted from a trading activity. All other passive income earned by an Irish holding company is taxed with 25%. Capital gains that do not qualify for the participation exemption are applied a 33% tax rate. When it comes to the repatriation of dividends, the Finance Act of 2013 introduced a tax credit for certain foreign dividends received by an Irish resident company. In all other cases the withholding tax on dividends is levied at a 20% tax rate.
For details about the taxation of holding companies please contact our Irish experts in company formation.